Trust based transaction system

Abstract

A method for applying graphs to determine creditworthiness is discussed. The method includes receiving a request for a transaction between a first and a second user. The method accesses a graph with directed edges between nodes, the directed edges indicating trusted relationships between users. First node is accessed to determine first user's risk score using weighted edges between the first node and other nodes (associated with other users). Active user ratio is determined based on number of active edges from the first node to first nodes, and on number of revoked edges from the first node to second nodes. Active edges correspond to edges between the first node and first nodes, revoked edges correspond to edges between the first node and second nodes that were removed prior to receipt of the request. Creditworthiness of the transaction is determined based on the risk score and active user ratio.

Description

CROSS-REFERENCE TO RELATED APPLICATIONS[0001]This patent application is a continuation of U.S. patent application Ser. No. 12 / 959,254, filed Dec. 2, 2010, which claims priority benefit of U.S. Provisional Application No. 61 / 283,347, filed Dec. 3, 2009, both of which are incorporated by reference in their entirety.BACKGROUND[0002]1. Field of Art[0003]The disclosure generally relates to the field electronic transactions, and more particularly, electronic transactions modeled on social-economical trust.[0004]2. Description of the Related Art[0005]Trust between any entities, and especially individuals, is an abstract concept. It is inherently difficult to measure, represent as data, and compare in useful ways. Small businesses and individuals generally have trouble tracking, measuring and representing to each-other the complicated systems of trust which underlay their economic relationships. Conventional banks and large institutions, who play a central role in moderating an individual's...

AI Technical Summary

Benefits of technology

This system streamlines financial transactions by leveraging trust networks to assess creditworthiness and fraud risk, enabling efficient and secure financial interactions beyond conventional banking methods.

Problems solved by technology

It is inherently difficult to measure, represent as data, and compare in useful ways.

Small businesses and individuals generally have trouble tracking, measuring and representing to each-other the complicated systems of trust which underlay their economic relationships.

Conventional banks and large institutions, who play a central role in moderating an individual's or entity's trustworthiness or creditworthiness, must painstakingly design expensive and slow tools for establishing, tracking, and quantifying the trustworthiness and creditworthiness of individuals and other institutions.

However, while conventional tools built largely by banks and large institutions are untimely, slow, complicated, and expensive, their biggest issue is that they are only able to capture and quantify a small percentage of financial relationships that an individual holds with other people and institutions.

These systems have little to no ability to efficiently capture, measure, or quantify the tens or hundreds of personal financially trusting relationships possibly held by the applicant with friends, colleagues, co-workers, family members, and other institutions.

With the rise in popularity of the Internet among the general public, the emergence of Internet-based payment solutions has partially expedited some financial transactions between individuals, but it has not addressed the underlying problem of capturing, tracking, measuring, and representing the vast majority of trusted financial relationships held among individuals, nor have internet-based payment solutions expedited financial transactions between individuals and organizations based on those trusted financial relationships.

With the rise in popularity of “social networking” services among the general public, people have become accustomed to establishing both symmetrical (bi-directional) and asymmetrical (uni-directional) “friend” or “follower” relationships to indicate an informational relationship or network connection through which information can flow between people, but these links are not able to represent financial trust.

“Social networking” services help users establish, represent, and measure personal “friendship” relationships and / or an informational interest in one another, they do not represent financial relationships nor do they enable any sort of financial mechanism or quantification of financial trust.

There is still no effective way using the Internet and connected mobile devices to capture, measure, represent, and quantify the personal, business, and organizational trusted financial links which are held widely within our society to establish trustworthiness and creditworthiness, as well as to increase the speed and efficiency of transactions.

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